January 6, 2019

Apple's projection slump in China

I remember a time visiting China when my uncle was super excited to show me his new American car - a Buick sedan, shiny, gold, and sparkling clean from his daily cleanings. American goods are (were?) sort of the pinnacle of luxury in China. Call it a manifestation of the United States’ “soft power” abroad - we manufacture and market some of the most desirable goods in the world.

One of the goods that had substantial market influence in China was the iPhone. We’ve heard it a lot: it’s a status symbol in China to have an American smartphone. Seeking to take advantage of China’s thirst for foreign goods, Apple intelligently decided to focus on the Chinese market in the early 2010s.

On January 2nd, Tim Cook released a memo revising their revenue projections for Q1 2019. Apple’s market capitalization subsequently dropped 10 percent, for a loss of over $100 billion.

Apple’s struggles in China have now been a long time coming. There are several surface-level reasons for the drop: the trade war, China’s slowing economy. But there is a bit more of a nuanced explanation for the slowdown in China. A lot of factors are in play. Competition from domestic brands like Huawei, Trump turning China off of American goods in general, WeChat’s monopoly in China over anything related to mobile applications, and the slow government shift to promoting a self-sustaining economy are a few things that are affecting Apple.

We’ve talked a little bit about how China’s trade surplus has led to RMB buybacks through their foreign exchange reserves. RMB outflows are a threat to the domestic Chinese economy, as the loss of value comes at the expense of higher inflation. One way to offset this trade surplus is by promoting domestic production and consumption. In particular, the government will work to promote companies that already have some market share in China, since those companies often already have government oversight and consumer trust. Huawei’s sales in China have actually grown relative to its peers. My own father has been indoctrinated into the Huawei line, simply because they understand Chinese consumers so much better. In many ways, Huawei is ahead of the competition in making the value proposition to consumers around the world, and especially in China. By matching or exceeding the feature set of the iPhone for a lower price, they’ve been slowly chipping away at Apple’s market share in China. Perhaps the iPhone isn’t as much of a Veblen good as once thought. Sluggish sales of the phone worldwide have prompted a trade-in program that seems antithetical to the Apple way.

Donald Trump’s inflammatory rhetoric has turned lots of Chinese folks off of American goods. The mentality for many is now: if American’s are able to elect someone with such a negative attitude towards China, why should we support their economy? In fact, the Donald dominates the airwaves in China nearly as much as he does in the United States. This means the CCP has more justification to keep some young Chinese from leaning Westward culturally. Compounded with the impact of the ongoing trade war, and government propaganda to buy domestic, Donald is having a huge impact on American companies’ ability to sell in China.

It’s hard to talk about mobile phones in China without talking about WeChat. For many Chinese, all you really need is a phone that can handle WeChat, where you can get your Facebook, Twitter, Youtube, Venmo, and Apple Pay all in one. All your apps can be run directly from within WeChat, which makes Chinese smartphone users’ lives easier (not to mention the CCP’s handle of the people easier too). “If a phone can run WeChat, I don’t care what brand it is” they say. It makes the ultra-high end luxury phones a hard sell for Apple in a market that really doesn’t need it. Further, the technology gap between a Xiaomi or Huawei and an iPhone is slimming. In fact, the Chinese phones actually perform better in many cases.

I started writing this on the 6th in the light of Apple’s investor letter. Since then, several things have changed. One, it seems like China has given in to the pressure of their buckling economy to some of the Donald’s trade demands. This seems to be largely a rhetorical promise - in the end, the Chinese can simply throw up their hands and say “we tried to reduce the trade surplus, but we’re just so good at exporting, you know?” On the other side of the Pacific, the White House has also considered reducing their aggression towards China.

There was also this good article the other day about the controls that China has to control their economy, that warrants a completely separate blog post.

October 21, 2018

What is currency manipulation?

One recent piece of economic news was that China was not labeled a currency manipulator in the eyes of the United States. Since then, the RMB has dropped to its lowest level against the dollar in over a year.

The Donald has been calling China a currency manipulator since the election. Why does China want to have a weak currency? What good does it do to place a label on China as a currency manipulator? How do you manipulate currency? Is Donald right?

TL;DR: To make exports cheap. None. Adjusting the money supply. No.

China, for over twenty years, has been a net exporter of goods to the rest of the world. This was a huge part of Deng Xiaoping’s “Socialism with Chinese characteristics” policy. China would industrialize, and industrialize quickly, taking advantage of its behemoth workforce to make products for the rest of the world. Initially, it was real cheap to buy products from China because its people were still in poverty, reeling from Mao’s Cultural Revolution. The labor force was just struggling to put food on the table at home. As a result, foreign nations kept pumping money into the Chinese system. Dollars and euros and pounds (but mostly dollars) flow into the Chinese economy to purchase these goods. This, in turn, produces growth in the Chinese economy. All of these dollars are exchanged for RMB to pay workers. Since so much of this USD -> RMB exchange is happening, one would expect the normal laws of supply and demand to kick in. The price of the RMB should go up. It doesn’t.

China wants to keep its currency undervalued so that it can remain a net exporter of goods. For people in China, this means that leaving the country and buying foreign goods can be prohibitively expensive. This is one of the reasons why American-made cars are often viewed as luxury goods in China. But instead of letting their currency float, the People’s Bank of China would take the influx of dollars from trade and exchange them for RMB at a fixed exchange rate. The People’s Bank can do this essentially because they print the money. With these dollars, the PBOC can go out and buy some more US treasuries, adding to the US debt to China.

China can also control the value of its currency by selling and buying domestic bonds and adjusting the reserve ratio and discount rate. Each of these methods affects the money supply in the system, which in turn affects its forex rates.

Over the past decade, the RMB has been a mixture of a fixed-rate currency (when the exchange rate with the US was essentially flat) and a “managed float” currency. It’s a pseudo-floating currency that will occasionally see government intervention in the name of “market forces” that justify the devaluation of the currency. “Market forces” refer to the failure to meet ambitious growth targets of 6-8% over the year. In order to meet those growth targets, the government did the logical thing and spurred on the economy by reducing interest rates and devaluing the currency. This is at least somewhat justified. China, as an export-driven economy, needs to maintain growth by providing competitive prices on goods. On the other hand, it is very artificial, leading Chinese people to be more dependent on the domestic economy and less able to purchase foreign goods.

As China continues to devalue the currency, Chinese goods continued to be cheap, leading to more foreign inflows. This inflow of foreign money puts upward pressure on the yuan, and so China needed to infuse more yuan into the money supply. This cycle feeds itself, leaving the PBOC in a bit of a pickle today.

In labeling China a currency manipulator, pretty much nothing actually happens. Any review that the Treasury will conduct under the new label would have been done anyway. For Donald, it’s fulfilling a campaign promise. For the rest of the world, it’s stoking more tensions that don’t need to exist in the first place.

The trade war over the last several months has caused a depreciation in the value of China’s currency, as China makes its goods cheaper to compete in the American market with the tariffs. This only devalues the RMB even more.

In 2015, the IMF announced the addition of the RMB to the reserve currency list. At the same time, it wasn’t yet fully ready to embrace the yuan. Neither are investors - the fact that PBOC policy influences the value of the yuan as much as it does means that investors and governments are wary of keeping their money in yuan. In a normal economy, keeping yuan would be fine, because the value of the RMB would rise against other currencies. But with the depreciation in value of the RMB combined with a slowdown in growth of the Chinese economy, many are not interested in keeping the RMB. As you find in any country/corporation, laws of big numbers come into play - you can’t sustain 6%+ of growth year over year forever. More recently, China has been coming to terms with this fact, and as a result need to reconsider the structure of the economy.

Even Chinese individuals are trying their best to get money out of yuan. The Chinese government imposes a $50,000 USD foreign exchange outflow quota for individuals. For wealthy Chinese families, this is only a small barrier in getting their money out of RMB. Many will use their quotas in combination with extended friends and family’s quotas to go invest in foreign real estate, bonds, and other markets. Fraudulent papers and accounts can also be used to transfer money out of yuan.

As a side note, the sentiment on the RMB is another reason why wealthy Chinese often turn to real estate - one of the few investments with firm value and growth projections that coincide with Chinese growth targets.

As Chinese investors and companies look outside China for investment opportunity, the demand for the yuan decreases, putting downward pressure on its value. In order to prevent a complete collapse of the currency, China began digging into their forex reserves. This means selling dollars and buying yuan, to increase the supply of the dollar and reduce its value against the yuan. This is propping RMB up in value. Donald says that the RMB is undervalued. In reality, it’s probably overvalued right now.

Suppose the PBOC just went hands off on the RMB right now, letting it float. No outflow quotas, no money supply manipulation, no selling of USD reserves. Market forces would decide the value of the RMB. As a result of China’s slowing economy, we could see the RMB plummet in value. This would likely send a shock through the Chinese economy. But at some point, the PBOC can’t sustain this much longer.

China needs to come to terms with the fact that it can no longer focus on an export-driven economy. They’ve progressed admirably through the stages of industrialization and development, and need to start acting like a grown-up. They need to let their currency float properly, open markets up to both inflows and outflows, and allow Chinese people to participate in the global marketplace. In the long term, this is the only way to ensure that China maintains some amount of growth sustainably.

Here is a cool infographic on how the (downward) currency manipulation works.

September 19, 2017

Parent Tinder

I talked previously about town square matchmaking. There’s another story to tell.

My parents were taking a walk by their Shenzhen apartment when they notice a fair amount of commotion in a square nearby. They decided to go check it out.

Posted on bulletin boards in the square are 8.5 by 11 pieces of paper with titles like “Looking for female”. The body of the ad is a description of height, some important personal characteristics ( “good posture”), and whether the person is equipped with a house, car, and job.

A man approaches my dad as he walks in, asking abruptly: “male or female?” My dad takes a second to register that the man was asking about his child, not himself. Understanding that it would be awkward to say “I have four children”, he says he has a daughter.

The man proceeds to give an elevator pitch on his son. 173 cm, stable job, an apartment, good character, studying for a PhD.

My sister is studying for a PhD as well, so dad pipes in: “my daughter is studying for a PhD, too!”

“Then what are you looking for??”

The implication here is that women who are highly educated in China are seen as particularly undesirable. There are three genders in China: male, female, and highly-educated females. Unfortunately for my sister, she falls in the third category.

There’s not a lot to say about this, except that it is obvious that feminism has not yet gained a strong foothold in China. Despite Mao’s declaration that “women hold up half the sky” and deserve equal representation in the workforce, societal ideas about women in the workplace have changed little from traditional Confucian ideas.

Fortunately for my sister, she’s not looking for men who see education as undesirable.

May 22, 2017

Another revolution?

In America, when we think of Chinese totalitarianism, we think about the iconic image of the man and the tank at Tiananmen in 1989. We applaud and respect this man, as many still do in China. At the same time, some wonder why the people don’t rise up now in the name of democracy.

Besides the CCP’s willingness to make arrests like that of Ai Weiwei in 2011, there are several reasons why the Chinese people have not risen up against their government. Here are a couple of them.

Fatigue from continual revolution. It’s one of the common themes of Chinese history, noted by so many historians that it almost does not bear repeating. China and Chinese people are inclined to revolutionize, to change the whole system in a day, to overturn the current leadership to create a better, new China. But time and time again, they need to be reminded that Rome (and Beijing) weren’t built in a day. A generation after the Cultural Revolution, radicalism is too fresh a reminder of the horrors of those ten years. Many Chinese are willing to pay the price for normalcy and stability, and avoid drastic political movements.

Indifference of the CCP. If you say you’re going to die for democracy, then you’re going to need to prove it. Mao once said “China has too many people, if someone is going to commit suicide, then let them do it”. The Communist Party is actually better off if there are martyrs; it means that the most radical dissidents remove themselves from society. The amount that the CCP cares about the life of a martyr for democracy is small.

Liu Xiaobo, 2010 winner of the Nobel Peace Prize, is currently a political prisoner of the CCP. He argued in his essay “That holy word: Revolution” that “The least costly way to democratization and modernization is self-reform of the Communist Party”. I believe him.

May 8, 2017

Hong Kong and China

World maps are deceiving. In most of today’s maps, Hong Kong and mainland China are painted the same color. A naive observer would look at the map and say, “alright, the mainland and Hong Kong must have a similar culture and feel”. But it was obvious from the moment I stepped off the plane into HK that this is untrue.

There are those social differences, pointed out by Cantonese professors that make overt generalizations about mainlanders versus Hong Kongers in terms of relationships (mainlanders more clingy, Hong Kongers more picky). There’s the division between Hong Kong students in the back of the classroom and mainland students in the front of the classroom. Or the knowledge of the Tiananmen incident, exclusive to Hong Kong students. Or the swagger with which Hong Kong students walk.

Hong Kong feels more like a New York City than China. Both Hong Kong Island and the Kowloon peninsula give a more Western vibe than the rest of China.

Hong Kong Island was originally ceded to Britain in 1841, with the First Opium War. A mountainous, uninhabited island at the time, it soon became the center of British trade with China. Most infamously, the opium trade in China was headquartered in Hong Kong.

There’s some more history to this. Kowloon peninsula and the New Territories ceded late in the 19th century. Japanese occupation during World War II. Rapid Westernization after World War II. The 1997 handover that Deng Xiaoping did not live to see.

The next major event in the foreseeable future for Hong Kong will be in 2047, with the return of Hong Kong under full control of China. Hong Kongers have already expressed an aversion to rejoining the People’s Republic, and there is little to show that sentiments will change. The new chief executive, Carrie Lam, represents the status quo in terms of leadership - a native Hong Konger with (at least a little) respect from her constituents, she is inevitably guided by the firm hand of the Communist Party.

Whether or not things will change in the next thirty years is questionable, but I am tempted to say that by 2047 Hong Kong will be unrecognizable in comparison to the rest of China. Already, more Hong Kongers than ever are identifying themselves not as Chinese, but as Hong Kongers. There is a growing sense of national identity in Hong Kong, where the nation is not China.

May 3, 2017

I don't want it!

When I go places in China to visit family, friends, friends of family, family of friends, family friends of friend’s families, or friends’ families of family friends, there’s this thing that they do: give me stuff. Giant boxes of snacks, candy, fresh Chinese pastries, money. It’s great, but I always feel a bit undeserving.

I can’t really say that getting stuff is not fun, or that the stuff they give me is undesirable. But the enthusiasm with which they give things catches me off guard sometimes.

I used to always say no. Usually a polite kind of no, a kind used for things you want but can’t be too eager about. Sometimes, it’s a repeated no, because I feel that they have actually made a significant sacrifice in their lives to give me a gift. Giving hundreds of dollars on a $8,655 annual wage seems a little high a price for the love of your second cousin once removed. I sometimes avoid taking gifts because they are impossible to lug around due to an absurd amount of packaging, or because large quantities of snacks cannot be eaten in the short periods of time that I am usually in China.

In Chinese, they call this politeness keqi, hence the Chinese translation for “you’re welcome” is bu keqi (bu meaning “don’t” or “not”). And as much as people tell other people in China to not be keqi, no one seems to get the message. The custom of saying no when offered anything has definitely not changed in my lifetime. The best way to decisively refuse snacks is by claiming you have a deadly food allergy (and even then, they might tell you to give it to your brother).

Some people take the act of giving things very seriously, which can get downright uncomfortable. A man I had known for five minutes offered me a giant box of assorted Chinese nuts when I said “I’m feeling some dinner!” Personally, I’m not sure of whether or not he carries around a box of nuts specifically for opportunities like this. Another man invited my family over for some hot pot and the whole family proceeded to serve us as if it were a restaurant where they were not supposed to sit down in the first place.

So I’ve changed my tactics. Instead of saying no to everything, I say yes, catching the gift-giver off guard (they expect a no). By doing this, I assert my Americanness, as well as my ability to not be subject to the custom of saying no. I hope, by saying yes the first time, I show that I’m a man capable of making my own gift-receiving decisions (a little ironic, right?). So for future gifts, they’ll know I’m telling my real answer the first time. Whether or not this method works, I have yet to see.

April 22, 2017

Elementary schoolers

I asked a Chinese fourth grader a pretty simple question.

“Do you know who Zhou Enlai is?”

“Yes, of course!”

Here’s the kicker, the big follow up. It’s one of those questions that you would expect a fourth grader to answer pretty easily.

“Was Zhou Enlai good or bad?”

“Of course he was good! Otherwise, Mao wouldn’t have liked him so much, and he wouldn’t have been so high-ranking!”

As expected, the elementary school student is pretty good at blanket statements. If I want a straight answer, I’ll ask someone under the age of ten.

It’s probably at least a bit unfair to extrapolate a whole bunch of ideas about the Chinese propaganda machine in primary education from just this one encounter. But I’ll do it anyway.

To Western eyes, Zhou is generally seen as a pragmatist and a moderate relative to Mao. At the same time, he’s certainly not viewed in a good light. As the launcher of two of the deadliest campaigns in the Cultural Revolution, the “Cleanse the Class Ranks” campaign and the “One Strike, three antis” campaign, Zhou is responsible for the persecution of over forty million people, as well of the deaths and suicides of another several million.

What does this tell us about the education system in China? Something is being left out of social studies class. Perhaps at such a young age, students are not yet ready to handle the horrors of the cultural revolution. Nevertheless, Mao is still portrayed as a heroic revolutionary figure. Zhou is good, and the Communist Party is full of good people.

To be fair, this is not all that different from social studies classes in all countries. To nurture some level of nationalistic pride, young children must be ignorant of their country’s bad side.

In China, though, it’s more necessary than ever to make sure that the youth remain ignorant of the last sixty years of CCP history

April 12, 2017

Guangdong and the rest of China

There is no shortage of special geographic designations that the central government has established around China. It can be hard to keep track of: there’s Taiwan, special administrative regions, special economic zones, autonomous zones, etc. Naturally, giving different regions different designations leads to a divergence from the policies of the central government.

Guangdong province is one of these places. Though Guangdong is not designated as a special area as a whole, it contains three of the six municipal special economic zones in China: Shenzhen, Zhuhai, and Shantou. “Special economic zone” means less government oversight in businesses, which in turn means more room for economic growth. Tencent, Huawei, and numerous other behemoths of Chinese industry are based in the province.

Anyhow, the Economist has a fantastic report on the region. I found it interesting partly because I am in the region, and partly because it points out how problematic it is to refer to “China” as a singular entity when talking in economic terms.

April 2, 2017

Censorship and passing down the generations

I’m in a class this semester about the Cultural Revolution in China, a tumultuous decade from 1966-1976 where social and cultural upheavals were the norm rather than the exception. Here at the University of Hong Kong, nobody pays attention in class. It’s fine, even accepted: my hallmates here brag about how they haven’t been to class in weeks (I suppose they do that in the US, too). But the Cultural Revolution class, according to my professor, boasts “the highest attendance rate of any class at HKU” according to my professor. Hard to do, in a class of 300+ students. (Nevermind the fact that participation is required and each week students have to turn in answers to those questions).

Anyhow, people don’t usually pay attention in that class. The buzz about the room quite often resembles that of your average Starbucks (I’m sitting in one right now).

So when our professor revealed her true identity to our class, an uncharacteristic silence swept across the room. An underground artist during the third phase of the Cultural Revolution, quietly subverting the power of the Party. She painted after work into dusk, constantly dodging the watchful eye of the Communist Party. She was part of the wuming “gang” of artists (which translates to “Anonymous” or “No name”). This group consisted of counterrevolutionaries of all different backgrounds, tired of the persistent waves of supposed “revolution” that Mao was calling for. My professor’s name is Wang Aihe.

Now she’s a professor with two Harvard degrees, teaching a class that inspired many of the students involved in the 2014 Yellow Umbrella movement in Hong Kong. Once a counterrevolutionary, always a counterrevolutionary.

I often forget how my parents’ generation was a part of this history. My parents, and the parents of many other Chinese-Americans my age, were children and teenagers during the Cultural Revolution in China. All of them came to the US for a reason. Maybe it was the memory of the Cultural Revolution and the fear of history repeating itself, the pro-democracy sentiments like those of the students in Tiananmen in 1989, or a more mundane desire for a better life in the free world.

I only just recently learned that my dad was sent down to the countryside for re-education at the end of the the Cultural Revolution. My parents were third-wave red guards; my grandparents once wore tall dunce hats and wooden boards while so-called revolutionaries berated them.

In China, there’s no doubt that that decade is a forgotten part of history. Government censorship and a party-enforced taboo on the topic has all but erased the event. But it cannot be forgotten.

The number of books written about the Chinese Cultural Revolution does not match the scope of the event. In fact, both of the required reading books for our class were written by white male professors specializing in Chinese history. That is not to say that they are poorly written or factually incorrect; they are packed with facts. On the other hand, they lack the intimately personal narrative of a well-written memoir. I’m willing to put out two theories as to why a memoir does not exist:

  1. Writing about authentic personal experiences during the CR in China is essentially marking yourself as a political dissident if you’re in China. And if you’re trying to publish the book, forget about it.
  2. The people who have left China who can write about the Cultural Revolution often work in technical fields. Immigration policies around the world give precedence to people specializing in STEM fields. This means that emigrants in free countries are not necessarily focused on telling their stories. They’re not historians or authors or even that good at English.

I think that these are pretty convincing, though there are absolutely more reasons for the lack of literature on the Cultural Revolution. Needless to say, more stories need to be heard and preserved.

March 29, 2017

Let's talk about masculinity

The Chinese Communist Party can find its roots in the New Culture Movement of the 1910s and 20s, an attempt by students to eradicate traditional Chinese culture. Young people saw traditional Chinese values as a barrier to the growth of the new China. These young people would the first members of the future Communist party.

One of the ideas to be eradicated was the role of women in the family. Infamously, women in the late Qing dynasty were treated poorly: bound feet, the expectation of utmost loyalty to the husband, and subservience to the male gender all contributed to the condition.

Fast forward to today. We hear about some things on the news, or in commentaries about China. Infanticide as a result of the one child policy, the subsequent search for wives in South Korea, the gender gap in the workplace.

I’d argue that women in China today are better off than the women with bound feet in the 19th century.

But even while the proportion of women in Chinese universities is rising, women are not on the same level as men in social settings. Take, for example, dinner. At a table of twenty people, five of whom are women, rice wine is silently distributed to exactly fifteen people before dinner is served. In fact, teenage boys get to drink wine before their mothers. It’s an unspoken contract with the waitress: yes, only the men will be drinking tonight, thank you very much.

When the annual Spring Festival dumpling wrapping party comes around, all of the male colleagues bring their wives. Men watch as the dumplings appear in front of them, handiwork of their wives and female coworkers at the other table busily working away at a mound of ground pork. Indirectly, it’s a result of the patriarchal system built over thousands of years of Confucianism and female subservience. While all the women are at least adequate at wrapping the dumplings, about half of the men, born and raised in China, are as hopeless than the average American. The sad-looking, deformed dumplings wrapped by the men are a subtle reminder of women’s place in Chinese society.

The point is, China has not yet managed cast away the remnants of a patriarchal traditional culture. This is at least one indication that Mao’s word is not law: Mao expressed in the Little Red Book his hope that the New China “ensure freedom of marriage and equality as between men and women”.

Let’s hope things change.

March 26, 2017

Glorious houses

People have been talking about it for the last ten years: China’s ghost cities, the booming real estate market, and the inevitable bubble that the market creates. Wealthy Chinese often own a double-digit number of apartments. My aunt and uncle, not exactly wealthy Chinese, own six homes.

For some reason, every time I go to China, I find myself in the home of a relatively well-off government official or businessman. Their homes often look like the interiors of Macau casinos: grandiose, opulent, and above all, fake. Stone friezes, 19th-century style leather furniture, and marble floors give old-fashioned luxury hotel vibes.

To the socialist American liberal, these sorts of homes reflect a cultural inclination to flaunt wealth. They represent the sins of capitalism infiltrating the Chinese economy. Greed and lack of charity lead to fancy houses. Surely, there is some of that.

But there is another explanation. In China, real estate is the alternative to savings and the stock market. In America, there is no real concern about the volatility of the US dollar. I can put my money in a mutual fund or ETF and be reasonably satisfied with the safety of my investment. On the other hand, in China, with the unpredictable fluctuations and current depreciation of the RMB, it’s hard to be safe in an equity investment. Moreover, isn’t as much to be gained in the Chinese stock market. So real estate serves as a physical alternative to equity investments.

Why is fancy real estate a favorite financial vehicle for wealthy Chinese?

  1. The Chinese stock market, and the RMB, are unpredictable and always fluctuating based on the feelings of the Chinese government. There is a fear that the RMB’s real value is drastically different from what exchanges say.
  2. There is some sense of security in the fact that the apartment, being a physical entity, will always have some value.
  3. The best way to ensure that your apartment retains its value in the much-anticipated real estate bubble collapse is to ensure that it occupies a certain niche in the home market. The fancy-home market seems like a good one for many, especially since as the number of wealthy Chinese increases, the demand for these homes increases.
  4. While the market is on the up and up, apartment owners can get handsome dividends from rural migrants, and city dwellers moving up the social ladder.

Thanks Kerry for the info on Chinese markets (She knows a lot more about this than I do).

March 18, 2017

A square and a spouse

It’s something that we like to joke about: arranged marriages by the parents. In literature and film, arranged marriages represent parents’ stubborn traditionalism.

Enter modern China. Young Chinese these days are free to marry whomever they please (with parental permission, of course). However, with China’s rapid modernization, increasing education of women, and increasing proportion of college graduates living with their parents, the younger generation will get married later than ever. This, of course, is a natural product of modernization and urbanization. As women are better educated, they are less likely to tie themselves down with a family. Unfortunately, for Chinese parents, this is a source of worry. It’s a combination of traditional values, wanting grandchildren, and “I never signed up for my kid to be at home for forty years”.

“Why has my child not found a suitable wife/husband at age 25?” Well, I see two answers. First is because of the above. Second is that your child is gay, and the intense social taboo against homosexuality in China keeps your child from coming out of the closet. This is a tragedy: LGBT people in China have never been able to escape the closet, thanks to traditional ideas. They wonder what is wrong with themselves, why no one has ever told them that being gay is natural.

Which brings me to my cousin. Mid-thirties, college educated, with a decent job. Single. He was married for a year or so before getting divorced. He’s living with his parents.

My aunt and uncle are getting increasingly worried, and they’re not alone. In fact, every Tuesday and Thursday, they go to the local square and meet other couples just like them. Carrying some photos of their son, they dress up somewhat classy before heading to the square. Other parents mill about, carrying pictures of their single (and only) child.

Yes, these parents are worried enough to go out and date for their children. If they see a picture of a girl they like, they go and greet the parents. If the conversation goes well, they exchange photos and contact information. If the son likes the picture, he arranges a date. If the kids fall in love, they get married. Easy. Simple. Honestly, the best way to get your son married ASAP.

I find this hilarious, arranged love with a modern twist. I silently pray that my parents will never go to such lengths to find me a wife.